ESL Investments said it has closed on its purchase of Sears Holdings Corp. for $5.2 billion, but now there’s a question over how much apparel might be sold in its stores.
The hedge fund run by Edward S. Lampert, Sears’ chairman, said Monday that the new Sears will have 223 Sears and 202 Kmart stores, along with the Sears Home Services and Sears Auto Centers in operation. It also emphasized that the new re-organized Sears has “more than $400 million in excess availability on its new asset-backed credit facility,” which the company said is enough to pay assumed liabilities, execute go-forward initiatives, and invest in new, smaller stores to expand the company’s reach in the hardline category. The company before the bankruptcy tinkered with a concept store just on appliances, and another one focused just on appliances and mattresses.
That strategy could mean that going forward, apparel becomes a smaller component of the overall business as appliances and tools take on more square footage in its stores and at the concept locations.
The new management team includes Greg Ladley, president of softlines. The company also said it intends to conduct a search for a chief executive officer “with a record of success in managing platform businesses and effectuating large-scale dynamic transformations.”
ESL also emphasized that vendors and suppliers “will continue to be paid in the ordinary course for all goods and services under agreed upon terms.” It also said that the “new Sears has a plan to be EBITDA [earnings before interest, taxes, depreciation and amortization] positive in fiscal 2019.